Female-Led Consumption – A Long-Term Trend to Benefit Many Sectors
One of the effects of the global economic recession has been the rising rates of labour force participation by women, especially in developed economies, as the recession has disproportionately affected jobs in traditionally male-dominated industries such as engineering and construction, meaning that more women are becoming the principal income earner of households. At Euromonitor International we think that this is an important long-term trend, impacting business strategies of consumer-focused companies across many sectors, because female-led consumption will be on the rise thanks to women’s higher incomes and greater independence.
Real Period Growth in Annual Disposable Income per Capita by Sex in Selected Countries: 2007-2012
Source: Euromonitor International
Globally, over the 2007-2012 period, the annual disposable income per capita for women rose at a faster rate than that of men. In particularly, in developed countries, the annual disposable income per capita for women increased by 1.3% in real terms over the period, compared to a 1.9% real decrease for men. BRIC countries and other major emerging markets witnessed a similar trend. In poorer developing countries, however, we recognise findings by the World Bank and development organisations that the economic downturn has hit women the hardest.
Already in many countries women are making the majority of purchasing decisions in households. As they experience rising incomes, their role in the consumer market is further enhanced, meaning that female marketing is becoming particularly important for consumer-focused businesses.
Although women’s incomes are uneven between developed and developing markets, the overall trend of rising disposable income for women will create new business opportunities in many countries. Not only will sectors traditionally serving more female consumers (such as clothing, footwear, health and beauty goods) benefit, but sectors that do not traditionally target women (such as cars, consumer electronics, and financial services) will also see rising demand from women.
At Euromonitor International we are of the opinion that the trends of more female income earners and rising incomes for women are here to stay. Thanks to rising costs of living and a desire for greater independence, those who were forced into the labour market by the recession will not be in a hurry to leave as the global economy picks up. Over the 2013-2020 period, the global average annual disposable income per capita for women will rise by 18.2% in real terms, compared to 6.1% real growth over the 2007-2012 period.